SBA Relief Options
Summary of U.S. Small Business Administration (SBA) Financial Assistance
The U.S. Small Business Administration has a number of resources available to small businesses impacted by the coronavirus (COVID-19).
You may direct all inquiries and questions to the SBA’s Massachusetts District Office email at: MassachusettsDO@sba.gov.
Important SBA Links:
Paycheck Protection Program (PPP)
The Paycheck Protection Program (PPP) is a Small Business Administration loan program designed to provide a direct incentive for small businesses to keep workers on the payroll. Loans issued under this program may be forgivable if a borrower uses the funds for certain eligible costs.
This program was available throughout spring and summer 2020 through CARES Act authorization and funding. Recent federal legislation (The Economic Aid to Hard-Hit Small Businesses, Non-Profits, and Venues Act) authorized an additional $284.5 billion available to the Paycheck Protection Program. On January 8, 2021, SBA published new guidance for the Paycheck Protection Program.
In addition, the recent legislation made changes to the PPP program, including:
- Allows past recipients to receive a "Second Draw" from PPP
- Makes 501(c)6 nonprofits (like Chambers of Commerce) eligible applicants, among other types of organizations
- Allows borrowers to set their covered loan period to any length from 8-24 weeks to allow additional flexibility
- Expands what is a eligible forgivable expense to include costs, including adaptive operations expenditures, property damage costs, technology operations, supplier costs, and worker protection expenditures
- Clarifies that PPP loans are tax-free and eligible expenses paid with PPP proceeds are tax-deductible
- Caps First Draw loans at $10 million and Second Draw loans at $2 million
- Allows Accommodations and Food Service businesses to obtain loans calculated at 3.5x average monthly payroll
How to Apply:. With this new funding, the program is currently accepting applications from community financial institutions and small lenders, and opens to all lenders on January 19, 2021.
Interested businesses should reach out to an SBA lender to apply for a “First Draw” or “Second Draw” PPP loan. Businesses that need help locating an SBA lender can utilize the Lender Match tool. Finally, businesses should consult Frequently Asked Questions for Lenders and Borrowers (12/9/2020).
SBA Economic Injury Disaster Loan (EIDL) Program
Notice: The SBA will accept applications for Economic Injury Disaster Loans from first-time EIDL borrowers until December 31, 2021.
Small businesses, private non-profit organizations of any size, small agricultural cooperatives and small aquaculture enterprises that have been financially impacted as a direct result of the Coronavirus (COVID-19) since Jan. 31, 2020, may qualify for Economic Injury Disaster Loans of up to $2 million to help meet financial obligations and operating expenses which could have been met had the disaster not occurred. Eligibility for Economic Injury Disaster Loans is based on the financial impact of the Coronavirus (COVID-19). The interest rate is 3.75 percent for small businesses. The interest rate for private non-profit organizations is 2.75 percent. SBA offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years and are available to entities without the financial ability to offset the adverse impact without hardship.
- A streamlined application is available online: covid19relief.sba.gov.
- The deadline to apply for an Economic Injury Disaster Loan is Dec. 18, 2020.
The SBA will accept applications for first time Economic Injury Disaster Loans until December 31, 2021.
SBA Express Bridge Loan Program
The Express Bridge Loan Program is available to businesses that have an existing business relationship with an SBA-approved lender; speak to your lender about accessing this option while you await a decision on long-term financing.
SBA Debt Relief Program
The SBA is also offering Debt Relief to small businesses. Under this relief, the SBA will automatically pay the principal and interest for six months beginning March 27th, 2020 for qualifying new and current holders of 7(a) loans, 504, and microloans
- Who can apply? Businesses who already have a covered 7(a), 504, or microloan or receive one prior to September 27, 2020.
- When can I apply? This relief is automatically applied for covered loans beginning with payments due after March 27, 2020.
- How do I apply? Reach out to your SBA lender to discuss how this debt relief applies to your SBA loan.
- What else should I know? This debt relief is available only to 7(a), 504, or microloans and not to loans made under the Paycheck Protection Program.
- More details.
***NEW*** Shuttered Venues Operators Grants
The Shuttered Venues Operators (SVO) Grant Program is new program authorized by The Economic Aid to Hard-Hit Small Businesses, Non-Profits, and Venues Act, signed into law on December 27, 2020 and administered by the Small Business Administration.
Eligible businesses that have suffered revenue losses resulting from the Coronavirus may apply for up to $10M in grant funding, which must be used to cover allowable costs. Eligible entities include:
- Live venue operators or promoters
- Theatrical producers
- Live performing arts organization operators
- Relevant museum operators, zoos and aquariums who meet specific criteria
- Motion picture theater operators
- Talent representatives
- Each business entity owned by an eligible entity that also meets the eligibility requirements
Other requirements of note:
- Must have been in operation as of February 29, 2020
- Venue or promoter who received a PPP loan on or after December 27, 2020, will have the SVOG reduced by the PPP loan amount
How to Apply:
SVOG applications open April 8 at 12 p.m. EDT.
Starting at 12 p.m. EDT, eligible entities will be able to start their SVOG application via the SVOG application portal. Once you begin, remember to save along the way and refer to SBA’s SVOG website (www.sba.gov/svogrant) for reference materials as you go through the process.
The SBA has created several tools and resources to help potential SVOG applicants prepare, including:
- Video tutorials, including how to register on the System for Award Management (SAM.gov), a federal requirement to receive an SVOG
- A Preliminary Application Checklist to help you gather documents and other information that may be needed
- An Eligibility Requirements Chart to help determine qualifications
NOAA Fisheries Funding
The U.S. Department of Commerce National Oceanic and Atmospheric Administration (NOAA) Fisheries will provide $300M in federal CARES Act funding for fishery participants affected by COVID-19. Massachusetts has been allocated $28M of this funding to support coastal and marine fisheries.
- Who can apply? Fishery participants include Tribes, individuals, fishing communities, aquaculture businesses, processors, or other fishery-related businesses who have (1) economic revenue losses greater than 35% compared to prior 5-year average revenue; or (2) any negative impacts to subsistence, cultural, or ceremonial fisheries.
- When can I apply? Applications were emailed on June 24th to the for-hire head boat permit holders only. All other sector applications (seafood processor, aquaculture, commercial fishing, and for-hire charter) will be ready once NOAA approves a spending plan for funds distribution. Visit the Massachusetts Division of Marine Fisheries (MA DMF) CARES Act Fisheries Relief webpage for the most up to date information about the application and dispersal process.
- How do I apply? Applications will be processed by the Division of Marine Fisheries. MA DMF will notify eligible fishery participants by email, permit holder mailings, and through local media outlets when they are ready to accept applications. Please check the MA DMF CARES Act webpage regularly for additional program information.
- What else should I know? For answers to specific questions, please contact MA DMF at firstname.lastname@example.org. You can also read more about this funding opportunity on the NOAA Fisheries CARES Act webpage and on the ASMFC CARES Act webpage. Massachusetts will engage in a public process to develop a disaster relief spending plan, and once the plan is approved, MA DMF will work with NOAA Fisheries, ASMFC, and the seafood industry to distribute funds as quickly as possible.
Other Lending Programs
Other Lending Programs
Main Street Lending Program
The Federal Reserve established a Main Street Lending Program to support lending to small and medium-sized businesses through three facilities: the Main Street New Loan Facility (MSNLF), the Main Street Priority Loan Facility (MSPLF), and the Main Street Expanded Loan Facility (MSELF). The program is designed to support eligible businesses that were unable to access the PPP or that require additional financial support after receiving a PPP loan.
- Who can apply? Businesses may be eligible for loans under the different facilities if they (1) have 15,000 employees or fewer; or (2) had 2019 revenues of $5 billion or less.
- When can I apply? The program is administered by the Federal Reserve Bank of Boston. The Main Street lender portal is now open for lender registration. Small and medium-sized businesses interested in the program should speak to an eligible lender about applying for program loans.
- How do I apply? Small and medium-sized businesses can apply for loans through an eligible lender. Sign up here to receive Main Street Lending Program updates and to register for webinars and drop-in sessions for potential lenders and borrowers.
- What else should I know? $600B in lending will be available nationally, with $75B in funding from the federal CARES Act. Loan minimums range from $250K to $10M, and loan maximums range from $35M to $300M. Loans have a term of 5 years, with principal repayment delayed for two years and interest payments delayed for one year. The Federal Reserve Bank will purchase 95% of each eligible loan from participating lenders, who will retain the remaining 5%. See the program FAQs for more information. Term sheets are available here.
Jobs for New England Working Capital Lending Program
The Federal Home Loan Bank of Boston’s (FHLB) Jobs for New England (JNE) Working Capital Lending Program will provide up to $1B in 6-month or 1-year 0% interest rate advances to its members, in order to finance small business working capital loans. Access the COVID-19 Relief JNE webinar slides here.
- Applications from FHLB Boston’s members will be accepted on a first come, first-served basis beginning on May 4th. Up to $20M may be available per member – see this list of FHLB Boston members (banks, credit unions, CDFIs).
- The program targets small businesses that need assistance in addition to our outside of the parameters of the federal Paycheck Protection Program (PPP). A maximum of $5M can be made available for any single business, for the purpose of working capital expenses, and with interest rates up to 2.00% for the initial term of the advance. More information is available in the FAQs.
Federal Tax Relief Provisions
The Employee Retention Tax Credit is a tax credit against federal tax liability that can benefit almost any employer (regardless of size and including tax-exempt organizations) whose business has been either fully or partially suspended by government orders due to COVID-19, or whose revenues have been significantly impacted by the COVID-19 outbreak. The purpose of the credit is to reduce a portion of the costs of keeping employees on payroll and provide direct relief to businesses. Employers can have an effective “refund” (tax credit) of up to $5,000 per employee by reducing their required payroll deposits. Eligibility for the credit is impacted by the business’ utilization of other federal stimulus programs.
- What does it mean for me? If you are an eligible employer paying wages (can include cash and health care costs), you can keep a portion of the employment taxes that you would normally withhold from employees’ paychecks and pay the federal government. This tax credit applies to qualified wages paid from March 13, 2020 to December 31, 2020.
- How do I take advantage of this? The IRS guidance notes that employers can be immediately reimbursed for the credit (your “refund”) by reducing their required deposits of employment taxes that have been withheld from employee’s wages by the amount of the credit (50%). Speak to your tax advisor about taking advantage of this credit.
- What else should I know? Employers can take a 50% credit for qualifying wages paid up to $10,000 in total per employee, so the maximum credit for an eligible employer is $5,000 per employee. You should also know that definitions for “qualified wages” depends on how many people a business employs; the IRS FAQ which clearly lays out what “qualified wages” means for employers with fewer than 100 employees and for employers with more than 100 employees.
- Read more: Read more about eligibility, what kinds of wages qualify, and how you can immediately benefit from this tax credit by reading the IRS’s announcement and helpful FAQs. For additional information about how this applies to your business, you should speak to your tax advisor regarding the Employee Retention Tax Credit,
Payroll Tax Deferral is another tax provision that can make a difference for employers. The CARES Act allows eligible employers to defer payment of part of their payroll taxes (which they would normally remit on a bi-weekly or monthly basis) to two larger payments; half due on December 31, 2021 and half due on December 31, 2022. As with the Employee Retention Tax Credit, this applies to federal tax liability.
- What does it mean for me? While every business should consult with a tax advisor to understand how this provision applies to their particular business, the intent of this deferral is to provide relief by deferring an eligible employer’s Social Security tax payments. Under the CARES Act, eligible employers do not need to pay their share of Social Security taxes for the period March 27, 2020 to December 31, 2020 until the first payment deadline of December 31, 2021. The IRS will not penalize eligible employers for not paying these taxes during this timeframe. This relief is also available to self-employed individuals for 50% of self-employed Social Security taxes.
- How can I take advantage of this? Speak to your tax advisor about this provision and how it applies to your business. You may be able to hold off on remitting these payments (again, taxes for the March 27 – December 31, 2020 period) to the federal government effective immediately, until the first payment is due. The IRS should produce additional guidance on this provision.
- What else should I know? You should be aware that deferring payment of these taxes may provide your business relief in the short term. Don’t overlook that you will still need to pay the full amount to the federal government, spread over two years, in two lump sums.
- Read more: Read more about this provision in the IRS’s policy document and keep an eye on the IRS’s Coronavirus Tax Relief page for additional guidance as it becomes available.
Anything else I should know?
- Employers can access both the Employee Retention Tax Credit and Payroll Tax Deferral provisions, but not for the same wages paid to employees.
- You cannot both receive loan forgiveness through an SBA program, like the Paycheck Protection Program, and also take advantage of the above provisions. Employers should weigh which option is right for their business.
Tax Credits for Paid Sick and Family Leave are available to eligible employers who are required to provide paid leave under the federal Families First Coronavirus Response Act (FFCRA). These new, refundable payroll tax credits are available for businesses with less than 500 employees (“eligible employers”) that are required by the FFCRA to pay qualified sick leave and family leave wages to their employees. Self-employed individuals are entitled to equivalent credits based on similar circumstances in which the individual is unable to work. For more information, see the IRS’s webpage on COVID-19-related Tax Credits for Paid Sick and Paid Family Leave.
- What does it mean for me? Employers that are providing paid leave under the FFCRA can access these refundable tax credits to get reimbursed for 100% of qualified leave paid from April 1, 2020 to December 31, 2020. Generally, the amount of credit an employer may receive depends on how much qualified sick and family leave the employer pays to its employees, which is determined by several factors.
- How do I take advantage of this? Eligible employers providing leave under FFCRA will report their total qualified leave wages and credits on a quarterly basis on their federal employment tax returns. Eligible employers can expedite access to the tax benefits by reducing their federal employment tax deposits (i.e. retaining payroll taxes you would normally deposit with the IRS). Since this is a fully refundable tax credit, if the amount of the credit exceeds the employer portion of federal employment taxes, the excess is treated as overpayment and refunded to the employer. The IRS has also outlined an advance payment process for eligible employers to request an advance of the credit.
- What else should I know? The IRS’s FAQ page provides additional guidance about the tax credits authorized by the FFCRA, including information on how to determine the amount of the credits. The maximum qualified sick leave paid per employee is $511 per day ($5,110 in aggregate) or $200 per day ($2,000 in aggregate) depending on the reason for leave. Further details on determining the amount of credit for qualified sick leave is available here. The maximum qualified family leave paid per employee is $200 per day ($10,000 in aggregate). Further details on determining the amount of credit for qualified family leave is available here.
- Read more: Read more about the FFCRA paid leave tax credits in the IRS’s announcement and read more about the employer paid leave requirements established by the FFCRA on the Department of Labor’s website. For additional information about how these tax credits may apply to your business, you should speak to your tax advisor.
State Tax Relief Measures
The Massachusetts Department of Revenue (DOR) is actively monitoring the latest developments regarding the COVID-19 coronavirus. Please visit their COVID-19 Coronavirus Response Update page for the latest on filing and payment extensions and penalty relief, tax or debt resolutions, communicating with DOR, and more.
Technical Assistance Resources for Small Businesses
The Small Business Administration’s Boston District Office offers financial and technical assistance; the District Office also connects small business owners to information and Resource Partners. SBA Resource Partners offer consulting services for free or nominal registration fees. These partners include:
- Small Business Development Centers (SBDCs): A network of centers that provide counseling and training to help small business owners start, grow and expand their business.
- COVID-19 Response: serving both new and existing small business clients with 1:1 remote business counseling and group workshop webinars
- Find an SBDC here.
- SCORE: Volunteer business counselors, advisors, and mentors who offer individual free to low cost counseling throughout the U.S. and its territories.
- COVID-19 Response: Tele-consults via call or Zoom offered by SCORE mentors, webinars and workshops
- Find a SCORE mentor here.
- Women’s Business Centers: WBCs provide free to low cost counseling and training and focus on women who want to start, grow and expand their small business.
- COVID-19 Response: Offering remote classes and self-paced workshops
- Find a WBC here.
- Veterans Business Outreach Centers: Designed to provide entrepreneurial development services and referrals for eligible veterans owning or considering starting a small business.
- COVID-19 Response: Offering remote classes and self-paced workshops
- Find a VBOC here.
- The COVID-19 Small Business Stabilization Network consists of MGCC Small Business Technical Assistance grantees, nonprofit organizations offering small business supports, including lending, financial education, and business coaching. There are 48 organizations in this cohort brought together by MGCC. Together, they cover the whole state.
- Translation Services for Paycheck Protection Program applications are available through MGCC’s partners across the state. This service will be available in 19 languages.
Federal Reserve Bank of Boston Resources
The Federal Reserve Bank of Boston compiled a list of organizations willing to provide technical assistance to small businesses and nonprofits with accessing the Paycheck Protection Program and a list of New England financial institutions that can process Paycheck Protection Program loans for non-customers. You can access these resources on the Federal Reserve Bank of Boston’s website.
MEMA’s Emergency Operations Center’s Private Sector Hotline
- The hotline will be staffed Monday – Friday from 8am to 4pm.
- The number for the hotline is 508-820-2094.
Executive Office of Labor & Workforce Development Resources
The Executive Office of Labor and Workforce Development offers resources for businesses related to employee benefits and has a new resource page. Programs include:
- The WorkShare program, a tool to help employers avoid layoffs during a downturn – read more about WorkShare.
- The Rapid Response program, which works closely with companies to avert layoffs and keep a skilled workforce engaged in the existing regional economy or industry; read more about how the Rapid Response Team can help businesses.
- Information regarding unemployment resources can be found here.
|Last updated:||April 8, 2021|